JUDGMENT - Parekh, N.K. J.-This Judge's Summons dated 21st October 1983 has been taken out by the applicants for an order that further proceedings in Company Petition No. 577 of 1983 be stayed under the provisions of sec-tion 34 of the Indian Arbitration Act, and that costs of the summons be provided for and for such other and further reliefs as this Court may deem lit. The summons is resisted by the respondents. 2. The facts that give rise to this summons are that there are two groups in the 1st respondent-company, one group known as “the Chitnis group” and the other group known as “the Srivastava group”. Both these groups are at loggerheads. Certain disputes and differences having arisen between the two groups, the same were referred to the arbitration of one Bal Thackeray. The said Bal Thackeray made an award dated 24th Novem-ber 1982 whereby he, inter alia, directed that the members of the Srivastava group do transfer their shareholding in the 1st respondent company to the Chitnis group, on the Chitnis group paying to the Srivastava group a sum of Rs. 11.68 lakhs. The said award was filed in this Court. Sudha Srivastava (i.e. the 2nd respondent herein) (belonging to the Srivastava group) thereupon filed a petition, being Petition No. 68 of 1983 in this Court, inter alia, challenging the said award. The petition has been accept-ed and presently adjourned for recording of evidence. Pending these pro-ceedings, one Kumar Amit being respondent No. 3 (in this Judge's Summons) filed a petition in this Court being Petition No. 269 of 1983 under sec-tions 397 and 398 of the Companies Act, inter alia, against the Chitnis and the Srivastava groups. This petition was resisted principally by the Chitnis group, and the focus of the said Kumar Amit to file the said petition was challenged. What seems to have transpired is that the said Kumar Amit had about 1200 shares of the 1st respondent-company in his name. How-ever, at the hearing of the said petition, it turned out that out of the said 1200 shares,” 600 shares were transferred to the name of one or the other member belonging to the Chitnis group, and the other 600 shares were transferred to one or the other member belonging to the Srivastava group. Therefore, the record of the company did not show any shares standing in the name of Kumar Amit. Therefore, the record of the company did not show any shares standing in the name of Kumar Amit. Kumar Amit took up the position that a fraud had been practised on him and that he was still the owner of the said shares. Be that as it may, it Appeared that in view of the fact that the company's record did not reflect the name of Kumar Amit as a share-holder, it came to be held that Kumar Amit had no locus to file the said petition, and Kumar Amit came to be non-suited. 3. It is thereafter that Sudha Srivastava (one of the members of the Srivastava group) filed this petition being Petition No. 577 of 1983 under sections 397 and 398 of the Companies Act. The “Chitnis group”, on their part, have taken out the present Judge's Summons for the reliefs mentioned in paragraph 1 above. 4. When this Judge's Summons reached hearing, Mr. Zaiwalla, the learned counsel for the applicants (i.e. “the Chitnis group”) moved an amendment to the effect that the proceedings in the Company Petition should be stayed not only in view of section 34 of the Arbitration Act but should be stayed in view of the provisions of section 10, read with sec- tions 141 and 151 of the Code of Civil Procedure. The amendment has been allowed. 5. Mr. Zaiwalla, the learned counsel for the applicants (i.e. the Chitnis group) next narrated the facts leading upto this Judge's Summons, and contended that admittedly, there were differences and disputes between the two groups. That these disputes were referred to the arbitration of one Bal Thackeray. That the arbitrator had made an award under which the “Srivastava group” has to sell their shares to the “Chitnis group” for a sum of Rs. 11.68 lakhs. That this award is in fact a final adjudication of a Court of the parties' own choice and would be final and binding on the parties. That it cannot be said that the award is just waste paper. On the other hand, as observed by the Supreme Court in the case of Satish (Kumar and others v, Surinder. 11.68 lakhs. That this award is in fact a final adjudication of a Court of the parties' own choice and would be final and binding on the parties. That it cannot be said that the award is just waste paper. On the other hand, as observed by the Supreme Court in the case of Satish (Kumar and others v, Surinder. Kumar and others)1, an award which is made is-entitled to that respect which is due to judgment of a Court of last resort.-That it does create rights in property although those rights may not be enforceable until the award is made a decree of the Court. Mr. Zaiwalla, argued that there are now in fact two proceedings before this. Court (a) petition filed by Sudha Srivastava (of the Srivastava group) challenging the said award and (b) this petition No, 577 of 1983 filed under sec-tions 397 and 398 of the Indian Companies Act. That it may transpire the: shallenge to the award may fail and the award is upheld. That if this-petition is proceeded with, the Court may arrive at a different conclusion insofar as the shares are concerned. In other words, there was a possibi-lity of there being conflicting decisions on the same subject. That in view of this, it would only be fit and proper to stay this petition and the proceed-ings therein, more particularly in view of the provisions, of section 10 read; with sections 141 and or section 151 of the Code of Civil Procedure. Mr. Zaiwalla, however conceded that section 34 of the Indian Arbitration; Act would be of no relevance whatsoever insofar as this, matter was concerned. 6. Mr. Bhatt, the learned counsel for respondent No. 2 stated that sn view of Mr. Zaiwalla's statement pertaining to section 34 of the Indian Arbitration Act, he did not wish to make any submissions insofar as that section was concerned. That Mr. Zaiwalla had, however., pressed into service the provisions of section 10 read with section 141 and section 151 of the Code of Civil Procedure. That section 10 of the Code of Civil Proce- dure dealt with stay of suits, pending in a Court of competent jurisdiction, and admittedly there were no such pending suits. In view of this, no question of stay of these proceedings under section 10 read with section 141 of the Code of Civil Procedure could arise. 7. Mr. That section 10 of the Code of Civil Proce- dure dealt with stay of suits, pending in a Court of competent jurisdiction, and admittedly there were no such pending suits. In view of this, no question of stay of these proceedings under section 10 read with section 141 of the Code of Civil Procedure could arise. 7. Mr. Bhatt next argued that Mr. Zaiwalla had, however, contended that the stay should be granted by the Court in its exercise of powers under section 151 of the Code of Civil Procedure, That it would hence be neces- sary to consider the scope of the powers of the Court under sections 397, 398 and 402 of the Companies Act, and in this context look at the obser- vations made in the case of (Bennet Coleman 8c Co. v. Union of India Ors.)2. That in that case, the Court held sections 397, 398 and 402 deal with emergent situations or extraordinary circumstances where the normal corporate management had failed and had run into oppression or mis- management and steps were required to be taken to prevent oppression and/or mismanagement in the conduct of the affairs of the company. That the powers of the Court under sections 397, 398 and 402 could not be read as being subject to the other provisions contained in sections dealing with usual corporate management of a company in normal circumstances. That the topic or subjects dealt with sections 397 and 398 were such that it would be impossible to read any such restriction or limitation on the powers of the Court acting under section 402. That under clause (a) of section 402, the Court's order may provide for a regulation of the conduct of the company's affairs in future and under clause (g), the Court's order may provide for any other matter for which in the opinion of the Court it was just and equitable that provision should be made. That under clause (a) of section 402, the Court's order may provide for a regulation of the conduct of the company's affairs in future and under clause (g), the Court's order may provide for any other matter for which in the opinion of the Court it was just and equitable that provision should be made. That an examination of the said sections brings out two aspects; first, the very wide nature of the power conferred on the Court, and secondly, the object that is sought to be achieved by the exercise of such power, with the result that the only limitation that could be impliedly read on the exercise of the power would be that nexus must exist between the order that may be passed thereunder and the object sought to be achieved by those sections, and that beyond this limitation which arises by necessary implication, it would be difficult even to read any other restriction or limitation on the exercise of the Court's power. That sections 397 and 398 were not only to avoid winding up of the company if possible and to keep it going, but at the same time was to relieve the minority shareholders from acts of oppression and mismanagement but preventing its affairs being conducted in a manner prejudicial to the public interest, and if that be the objective the Court would have power to interfere with the normal corporate management of the company, and to supplant the entire corpo-rate management, or rather, mismanagement, by resorting to non-corporate management which may take the form of appointing of an administrator or a special officer or a committee of advisers, etc., who would be in charge of the affairs of the company. The Court could even have a truncated form of corporate management if the exigencies of the case required it, and any truncated form of corporate management can never conform to all the provisions dealing with corporate management. Therefore, it was clear that while acting under section 398 read with section 402 of the Companies Act, the Court had ample jurisdiction and very wide powers to pass such orders and give-such directions as it thought fit to achieve the object. 8. Mr. Therefore, it was clear that while acting under section 398 read with section 402 of the Companies Act, the Court had ample jurisdiction and very wide powers to pass such orders and give-such directions as it thought fit to achieve the object. 8. Mr. Bhatt argued that if such be the powers that the Court is vested with by reason of the said three sections, it would be inconceivable that any such powers can be enjoined on any arbitrator or that an arbitrator can exercise the same. That it must, therefore, follow that matters which fall within the purview of sections 397 and 398 cannot be left to arbitra- tion, and even if they are arbitrated upon such arbitration would be of no consequence, and in any event, cannot fetter the said powers of the Court. That in view of this, the question of granting of a stay of these proceedings cannot arise. 9. Mr. Bhatt further contended that even if the articles of associa- tion provided that the disputes and differences pertaining to the mismanage- ment or oppression be referred to arbitration, even then, a shareholder would have a right to file a petition under sections 397 and 398, provided of course, the provisions of section 399 were satisfied and the jurisdiction of the Court would not be debarred. That a Court will not stay a petition filed under sections 397 and 393 based on an arbitration clause. In support of this contention, Mr. Bhatt relied upon the decision in (Suremdra Kumar Dhawan Anr. v. R. Vir Ors.)3. In the said case, it was held that the shareholders of a company had a right to file a petition under section 397 or section 398 of the Companies Act, 1956, for relief against mismanage-ment or oppression, if the provisions of section 399 were satisfied. That any article providing that a difference between the company and its director or between the directors themselves or between any members of the company or between the company and any person shall be referred to arbitration cannot debar the jurisdiction of the Court in the matter of a petition under section 397 or 398. That the Court will not stay a petition under section 397 or 398 on an application under section 34 of the Arbi-tration Act, 1940, based on the arbitration clause, Mr. That the Court will not stay a petition under section 397 or 398 on an application under section 34 of the Arbi-tration Act, 1940, based on the arbitration clause, Mr. Bhati submitted that in this matter an award had come to be filed, but the principle would be no different, and the petitioner would be entitled to no relief on this Judge's Summons. 10. Mr. Bhatt next invited attention to the ruling in the case of (O. P. Gupta v. Shiv General Finance (P.) Ltd. Ors)4. In that case it was observed that merely because there is an article in the articles of associa- tion of the company to the effect that any dispute between the company on the one hand and its members on the other will be referred to arbitra- tion, the Court will not stay a petition under section 397 or 398 of the Companies Act, 1956, for relief against mismanagement or oppression in the affairs of a company. That such an article could not be called into play for the purpose of staying proceedings under section 397 or 398. The provisions of sections 397 and 398 and of section 434 gave exclusive jurisdiction to the Court and the matters dealt with thereby cannot be referred to arbitration. It was further held that no arbitrator could possibly give relief to the petitioner under sections 397 and 398 or pass any order under section 402 or section 403. Mr. Bhatt submitted that in view ©f this also, the applicants would be disentitled to relief. 11. Mr. Bhatt submitted that looking to the very wide powers of the Court, and in view of the ratio of the aforementioned decisions, the ques- tion of exercising powers under section 151 by this Court on this Judge's Summons cannot arise. 12. Mr. Doctor, the learned counsel for respondent No. 3 argued that the respondent No. 3 herein was the person who had filed a petition being Petition No. 269 of 1983. That in the said petition, it was held that respondent No. 3 had no locus standi, and by reason of this, the petition had failed. But insofar as the present Judge's Summons is concerned, the position is wholly different. Admittedly, respondent No. 3 is a Technical Director of the company. His services are sought to be terminated. In other words, his rights are directly being affected. But insofar as the present Judge's Summons is concerned, the position is wholly different. Admittedly, respondent No. 3 is a Technical Director of the company. His services are sought to be terminated. In other words, his rights are directly being affected. That in fact, he has been made a party-respondent to the main petition, and, therefore, the question of his (i. e. respondent No. 3) having no locus standi insofar as this application is concerned cannot arise. 13. Mr. Doctor urged that coming to the subject matter of this Judge's Summons, it is true that there are two proceedings, one being a petition for the setting aside of the award filed by the 2nd respondent herein and the other being Petition No. 577 of 1983, but the subject matter of both these proceedings was different. In the petition for setting aside the award, what was impeached was an award, and to consider whether the said award was liable to be set aside, the Court had to arrive at one or other conclusions set out in section 30 of the Indian Arbitration Act. The said section provides as follows : “30. An award shall not be set aside except on one or more of the following grounds, namely : (a) that an arbitrator or umpire has misconducted himself or the proceedings; (b) that an award has been made after his issue of an order by the Court superseding the arbitration or after arbitration proceedings have become invalid under section 35; (c) that an award has been improperly procured or is otherwise invalid.” That the said section made it clear that what the Court was primarily con-cerned in the said proceedings was the conduct of the arbitrator, and not the conduct of the shareholders of the company. That insofar as this peti-tion under sections 397 and 398 was concerned, the Court was primarily concerned with the conduct of the shareholders. That the subject matter of both the proceedings were wholly different and the question of granting a stay on this Judge's Summons cannot arise. 14. Now, considering the rival contentions, it may be stated that admittedly there has been an award. That the subject matter of both the proceedings were wholly different and the question of granting a stay on this Judge's Summons cannot arise. 14. Now, considering the rival contentions, it may be stated that admittedly there has been an award. As regards the effect of such an award is concerned, the Supreme Court has, in the case of (Satish Kumar v. Surinder Kumar and others)5, referred to the decision in the case of (Bhajahari Saha Banikya v. Behary Lal Basak)6, wherein it was observed as follows: “ the award is in fact a final adjudication of a Court of the parties' own choice, and until impeached upon sufficient grounds in an appropriate proceeding, an award, which is on the face of it regular, or conclusive upon the merits of the controversy submitted, unless possibly the parties have intended that the award shall not be final and conclu- sive....” (Emphasis supplied). in this case, it is an admitted position that the award has been impeached and it is not urged by the applicants that this impeachment is not on suffi-cient ground, and not in an appropriate proceeding. This must detract from Mr. Zaiwalla's argument as to the effect of the said award. Then again, considering the ratios laid down in the cases cited by Mr. Bhatt, it is abundantly clear that merely because there is an arbitration clause or an arbitration proceeding, or for that matter an award, the Court's jurisdiction under sections 397 and 398 cannot stand fettered. On the other hand, Courts have gone to the length to hold that the matter which can form the subject matter of a petition under sections 397 and 398 cannot be the subject matter of an arbitration, for an arbitrator can have no powers such as are conferred on the Court by sections such as section 402 of the Com-panies Act. Furthermore, as pointed out by Mr. Doctor the scope of the two enquiries, namely that of the petition for setting aside the award, and this petition (No. 577 of 1983) under sections 397 and 398 are wholly different. In view of all this, section 10 of the Code of Civil Procedure read with section 141 can have no application whatsoever, nor can in view of the above discussion, the question of exercising powers under section 151 arise. 14. In the result, the company application fails. The same is dis-missed. In view of all this, section 10 of the Code of Civil Procedure read with section 141 can have no application whatsoever, nor can in view of the above discussion, the question of exercising powers under section 151 arise. 14. In the result, the company application fails. The same is dis-missed. The costs of the company application will be costs in the cause. Application dismissed. ----